The Central Bank announced the possibility of reducing the key rate in half

The Central Bank announced the possibility of reducing the key rate in half

17.06.2016

Key interest rate in Russia up to 6-6. 5 per cent subject to the achievement of target indicators of inflation. This was stated by first Deputy Central BankChairman Dmitry Tulin in kumaraparvatha international economic forum (SPIEF).

photo: Gennady Cherkasov

The reduction of the key rate in half can be expected in case of a fall in inflation to four percent. While Tulin noted that for commercial banks remains the solution is to use the window of opportunity for lending to small and medium businesses (SMEs), or to use reduced interest rates to Finance big business.

According to the Deputy Chairman of the Central Bank, high interest rates on loans now represent the main obstacle for business development. At this low rate, he said, will not lead to an automatic increase in small and medium business, as this requires additional incentives. “This is not a purely Russian feature, it is universal” – quotes its RIA Novosti.

Note that a week ago, the Central Bankdecided to reduce the key rate by 0.5 percentage points to 10.5 percent. Earlier, the Deputy Minister of economic development Alexei Vedev said that by the end of 2016 inflation will be 6.3-6.5 percent. Decline to four percent per year is expected in 2019.

Last year inflation in Russia amounted to 12.9 percent, and in 2014 is 11.4 percent,